Chapter 13 Bankruptcy Dismissed? Houston's Busby & Associates May Be Able to Help

HOUSTON - The people's attorney, Busby & Associates, continue their effort to empower the public through education on family and bankruptcy law, as one of Houston's leading full-service family law firms.

While their information campaign over the past several months has focused on changes in law affecting divorce and bankruptcy, the team of attorneys turn their attention to a Chapter 13 Bankruptcy that has been dismissed - helping clients understand what options they may have.

According to the Busby & Associates attorneys, individuals have three main options when their Chapter 13 Bankruptcy is dismissed: 1.) move to vacate the dismissal order and void the dismissal; 2.) re-file under Chapter 13; or 3.) re-file under Chapter 7.

"If an individual chooses the first option and moves to vacate the dismissal order and void the dismissal, it may be possible for them to have the court reinstate the case, which is likely if all missed payments are satisfied and the request for reinstatement is made no more than 10 days after the dismissal," said Busby & Associates Partner Michael Busby, Jr..

Busby explained that the next option, re-filing under Chapter 13, is possible if an individual has had one case dismissed in the last year and the automatic stay expired 30 days after the filing of the 2nd case.

He further explained that if this option is pursued and the individual has had within the last year two previously dismissed cases, with the present case representing the third, then some creative planning may be required.

"If you have a co-signer on the house or a car then a co-debtor stay may be available under this second option. Also, you will have to qualify for Chapter 13 as before and demonstrate that this subsequent filing was made in good faith," added Busby.

And according to Busby, the third option, re-filing under Chapter 7, when a Chapter 13 is dismissed is advisable if a discharge of debt was not received. Though by filing under Chapter 7, retaining property secured by debt, which was being paid by the Chapter 13, such as a car, is unlikely. But it is possible to obtain a discharge of most kinds of debt.

Though the attorneys point out that before re-filing, there is a 180-day wait period following the dismissal of a previous case if that case was dismissed under either one of two circumstances: 1.) the case was dismissed on the court's order because of willful failure to obey orders of the court or to appear in court when required - though inability to make plan payments would not necessarily be considered a willful failure to obey a court order); or 2.) the case was dismissed at the individual's request after the filing of a request for relief from the automatic stay. §109(g).

Busby & Associates is a full service bankruptcy and family law firm offering experienced and affordable assistance with Harris County bankruptcy, debt negotiation and consumer law as well as divorce, child custody and other family law matters. To learn more about the firm and the services they provide, and to discuss your options after a Chapter 13 bankruptcy is dismissed, call our Houston bankruptcy law firm at (713) 974-1151.